September 18, 2008

The Lull Before the Storm

Jan 15- Feb 14 10.4
Feb 15- Mar 14 8.3
Mar 15- Apr 14 9.2
Apr 15- May 14 6.5
May 15- Jun 14 8.2
Jun 15- Jul 14 13
Jul 15- Aug 14 10
Aug 15- Sep 14 4.8

4.8%—Amount of economy coverage the month before the Wall Street meltdown

The credit crisis hit Wall Street hard the week of September 15. Lehman Brothers filed for bankruptcy, Merrill Lynch was bought out Bank of America, and insurance giant AIG was rescued with an $85 billion bailout by the Federal Reserve. On Sept. 15, the Dow fell 504 points, the worst one-day drop since 9/11. Two days later, the market plunged another 450 points.

While this recent financial turmoil has dominated headlines and become the focus of the presidential race, PEJ’s News Coverage Index reveals that in the month preceding these events, press attention to the U.S. economy was at a low point for the year. From August 15 to September 14, coverage of the economy—which includes themes such as gas prices, banking industry troubles, the housing crisis, and retail sales—filled 4.8% of the media newshole. This is only about half the coverage (9.3%) the economy generated from Jan. 15 through Aug. 14.

From mid-January through mid- February, coverage of the financial crisis, which accounted for 10.4% of the newshole, was spurred by worries of an oncoming recession. In June and July, record high gas prices drove coverage of the economy to a 2008 high point of 13% of the newshole. Even into August, attention to ominous economic indicators reports kept the media focused on the economy (10%).

Yet, in the month before this week’s meltdown, coverage had eased off dramatically, falling by about 50% from the previous month. Now, the economy is back as a major newsmaker, but for how long?

Tricia Sartor of PEJ